Annual inflation in Armenia eased to 11.5 percent last month despite a continued rise in key consumer prices, according to official statistics released on Friday.

The year-on-year inflation rate was down from 12.4 percent registered by the National Statistical Service (NSS) in February. But it remained well above the maximum target of 5.5 percent that was set by the Armenian government and Central Bank for this year.

The latest NSS data show that the consumer price index in March was mainly pushed up by the increased cost of food products sold in the domestic market. It was up by as much as 17 percent from the March 2010 level.

Food prices rose by about 1 percent in the course of March 2011. The NSS reported a similar increase in February.

The Armenian authorities insist that inflation, which is hitting hard a large part of the country’s population, will drop considerably in the second half. Artur Stepanian, head of the Central Bank’s monetary policy division, predicted last month a full-year rate of 6 percent.

Stepanian argued that a spike in domestic agricultural output during the summer and autumn harvesting will help to offset the impact of significantly higher prices of basic foodstuffs imported to Armenia. The authorities say their increased cost in international markets is the main cause of the high inflation rates observed over the past year.

Bagrat Asatrian, an opposition-linked economist critical of the Armenian government, again disputed this explanation, saying that the price rises primarily result from a lack of competition in the Armenian economy. He claimed that the authorities have “done nothing” to break up economic monopolies and curb inflation.

“The fact remains that prices keep going up and their increase has not been stopped in any way,” Asatrian told RFE/RL’s Armenian service. He questioned the credibility of a slight drop in inflation recorded by the NSS in March.

Armenia officials admit that the effective monopolization of some sectors of the economy contributes to the rising cost of life in the country. The government approved last month a bill empowering it to limit the maximum cost of 20 foodstuffs if their retail prices soar by at least 30 percent within a month.

The International Monetary Fund has praised this and other anti-inflation measures taken by the authorities. “The authorities have increased the interest rates, helped farmers to increase the supply of agricultural goods, and public spending is very moderate,” the head of the IMF office in Yerevan, Guillermo Tolosa, told RFE/RL’s Armenian service on March 11.